• Major alcohol producers see share prices sink to decade-long lows amid consumption decline
• Gen Z drinks 20% less than Millennials, with 45% abstaining from alcohol entirely
• Gallup consumption gauge hits lowest level since records began in 1939

NEW YORK (TDR) — The global alcohol industry has suffered an $830 billion stock market wipeout as younger generations fundamentally reject drinking, triggering what analysts describe as a structural shift comparable to tobacco’s decades-long decline.

Major producers including Diageo, Pernod Ricard, Rémy Cointreau, and Brown-Forman have seen share prices sink to decade-long lows, while Chinese powerhouse Kweichow Moutai now trades more than 40% below its 2021 high.

“We’ve seen four times the impact of the financial crash on alcohol consumption,” said Laurence Whyatt, an analyst at Barclays, according to reporting from Yahoo Finance. “The market believes there’s been a structural shift, and we’re not going back to the growth rates we had before.”

Gen Z Leading the Charge

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Generation Z, born between 1997 and 2012, is drinking approximately 20% less than Millennials, with 45% of legal-age Gen Z consumers abstaining from alcohol entirely as of 2023, according to industry data compiled by Fortune.

In August, a Gallup gauge of U.S. alcohol consumption fell to the lowest level since records began in 1939, marking an unprecedented decline that has alarmed industry executives and investors.

Among Gen Z drinkers aged 21-27, 21.5% do not consume alcohol, while 39% drink only occasionally. Nearly half cite “not being interested,” while 34% abstain due to health and mental health concerns, according to Attest research.

“It is becoming clear that, for whatever reasons, today’s younger generations are just less interested in alcohol and are more likely than older generations to see it as risky for their health,” said National Institute on Alcohol Abuse and Alcoholism Director George F. Koob in a statement reported by TIME.

Multiple Factors Drive Decline

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Health consciousness ranks as the primary driver, with 58% of Gen Z planning to drink less in 2025 to improve mental health, a 45% increase from the prior year, according to Circana.

The rise of cannabis legalization provides alternatives, with 40 states legalizing medical marijuana and over 20 legalizing recreational use as of December 2025. GLP-1 weight-loss drugs like Ozempic also reduce consumption, while celebrity teetotaling trends accelerate the shift.

Economic pressures compound the problem. About 33% of Gen Zers worry about finances, with 64% reducing expenses including alcohol. Households over 30 now spend 0.74% of income on alcohol, down from 1.1% ten years ago.

Financial Devastation Across Sector

Global beverage alcohol volumes contracted by 0.4% in 2025, with spirits revenue falling 4.3% and volume dropping 1.1% in 2024, according to Investing.com analysis.

Pernod Ricard reported a 7.6% sales drop in Q1 2025, with U.S. and China sales falling 16% and 27% respectively. Brown-Forman saw Q2 2026 earnings fall 14% year-over-year.

Even Warren Buffett’s Berkshire Hathaway has seen losses of approximately 40% on its Constellation Brands investment. Companies face high debt, rising costs, and executive turnover, with major producers appointing new leadership to navigate the crisis.

Industry Pivots to Non-Alcoholic

Major producers are investing heavily in non-alcoholic alternatives. Anheuser-Busch InBev set a target of having low-and-no alcohol beers account for one-fifth of overall sales by 2025.

The non-alcoholic market could be worth more than $1.7 trillion by 2028, with total no-alcohol volumes rising 9% in 2024. Ready-to-drink cocktails showed 20% revenue growth in 2025, representing one bright spot.

However, analysts warn uncertainty now draws comparisons to tobacco’s decline “that would have been inconceivable five years ago.” “This industry’s been around for 7,000 years, but a lot can change,” said Andrew Gowen of Bell Asset Management.

Can the alcohol industry adapt to a generation that views sobriety as sophisticated, or will the $830 billion wipeout mark just the beginning of a structural decline?

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